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LC accounting question. Help please!

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  • 17-04-2014 9:09pm
    #1
    3raser10
    Registered Users Posts: 59 ✭✭


    Hey there! I have covered every topic except Ratios (Q5) & I don't intend to at this stage. I think I should rather learn theory than spend time learning this topic but now I am kinda getting worried if it is the right choice. :/ Do you think it is a wise choice to not cover this topic? please help! Thanks


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    #2
    raz789
    Registered Users Posts: 30 ✭raz789


    If you can do every Question possible that will be on Q6 and Q7 then I think you'll be good. I am contemplating whether or not to do Q5 as getting marks in it is quite hard, although the ratios are quite easy it's the essay type question that is hard.
    It's a lot easier to get marks in other questions.
    As long as your sure you can answer Q6s and Q7s, I think it'll be safe to skip.
    It's a guaranteed question though.


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    #3
    TitianGerm
    Registered Users Posts: 27,843 ✭✭✭✭TitianGerm


    3raser10 wrote: »
    Hey there! I have covered every topic except Ratios (Q5) & I don't intend to at this stage. I think I should rather learn theory than spend time learning this topic but now I am kinda getting worried if it is the right choice. :/ Do you think it is a wise choice to not cover this topic? please help! Thanks

    If you have plans of becoming an accountant or studying accountancy at college you should learn them. I'm doing professional exams now and the ratios are still coming up in exams now. If you know them fairly well you could save time in your exam if they came up.


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    #4
    Mr Pseudonym
    Closed Accounts Posts: 1,237 ✭✭✭Mr Pseudonym


    3raser10 wrote: »
    Hey there! I have covered every topic except Ratios (Q5) & I don't intend to at this stage. I think I should rather learn theory than spend time learning this topic but now I am kinda getting worried if it is the right choice. :/ Do you think it is a wise choice to not cover this topic? please help! Thanks

    The ratios are simple to learn (majority come from a list of about ten), and the interpretation question (b) requires the same type of analysis every year. Unless you are entirely comfortable with all the other questions, I think it would be advisable to cover it. Having said that, I sat the LC twice, and both times I decided not to answer it.

    Edit: getting marks in Q5 is really achievable. It's just getting an A that's a bit tricky.


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    #5
    3raser10
    Registered Users Posts: 59 ✭✭3raser10


    Thanks guys! I think I am gonna skip it. I think lol


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    #6
    robman60
    Registered Users Posts: 2,222 ✭✭✭robman60


    I'm covering it, but only intend to do it if published comes up for another Q in that section.

    The ratios are easy marks, but you're pretty much guaranteed to lose marks in the B part. I did the Q in the mocks and gave what I'd consider excellent analysis, nearly three pages of stuff. However, I got 31/40 as the marks were going for saying EXACTLY what they had in the marking scheme. It's not really fair as alternative correct analysis can obviously exist.

    In summary, probably a good question for 75/100 but 90+/100 will prove difficult.


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    #7
    3raser10
    Registered Users Posts: 59 ✭✭3raser10


    you know as there is a high chance of suspense coming up as 100m this year so I was worrying that I should cover question 5 in case completely new workings come up in suspense that I've never done before but now after understanding the topic & being able to finally do all the workings from previous exam papers, I think that even if there are completely new or tricky workings on the day, if I know the principles for doing T a/cs (i.e a & e on LHS, l & g on RHS, susp. a/c needed when debits n credits don't match, recording what should have happened and what did happen) then I should stop worrying. It's just this new workings thing that worries me. Rest of the question is easy & rest of the topics are fine as well :) someone please tell me that I'm just stressing out & that can never happen & I shall be fine as long as I know the principles lol...sigh


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    #8
    TitianGerm
    Registered Users Posts: 27,843 ✭✭✭✭TitianGerm


    3raser10 wrote: »
    you know as there is a high chance of suspense coming up as 100m this year so I was worrying that I should cover question 5 in case completely new workings come up in suspense that I've never done before but now after understanding the topic & being able to finally do all the workings from previous exam papers, I think that even if there are completely new or tricky workings on the day, if I know the principles for doing T a/cs (i.e a & e on LHS, l & g on RHS, susp. a/c needed when debits n credits don't match, recording what should have happened and what did happen) then I should stop worrying. It's just this new workings thing that worries me. Rest of the question is easy & rest of the topics are fine as well :) someone please tell me that I'm just stressing out & that can never happen & I shall be fine as long as I know the principles lol...sigh

    For T-Acs I think this is a handy tip

    Statement of Financial Position -
    Dr - Asset
    Cr - Liability

    Statement of Comprehensive Income -
    Dr - Liability/Expense
    Cr - Asset/Gain

    Sorry can't post actual T-Acs as I'm on my mobile.

    Remember with Suspense to follow these steps.
    1. What did they do wrong ?
    2. How do I reverse this ?
    3. What should they have done ?
    4. How do I do this ?


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    #9
    3raser10
    Registered Users Posts: 59 ✭✭3raser10


    emmetkenny wrote: »
    For T-Acs I think this is a handy tip

    Statement of Financial Position -
    Dr - Asset
    Cr - Liability

    Statement of Comprehensive Income -
    Dr - Liability/Expense
    Cr - Asset/Gain

    Sorry can't post actual T-Acs as I'm on my mobile.

    Remember with Suspense to follow these steps.
    1. What did they do wrong ?
    2. How do I reverse this ?
    3. What should they have done ?
    4. How do I do this ?
    Thank you so much! :D


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    #10
    raz789
    Registered Users Posts: 30 ✭raz789


    3raser10 wrote: »
    you know as there is a high chance of suspense coming up as 100m this year so I was worrying that I should cover question 5 in case completely new workings come up in suspense that I've never done before but now after understanding the topic & being able to finally do all the workings from previous exam papers, I think that even if there are completely new or tricky workings on the day, if I know the principles for doing T a/cs (i.e a & e on LHS, l & g on RHS, susp. a/c needed when debits n credits don't match, recording what should have happened and what did happen) then I should stop worrying. It's just this new workings thing that worries me. Rest of the question is easy & rest of the topics are fine as well :) someone please tell me that I'm just stressing out & that can never happen & I shall be fine as long as I know the principles lol...sigh

    What's really handy for these questions is you can use the Trial Balance from Q1.


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    #11
    TitianGerm
    Registered Users Posts: 27,843 ✭✭✭✭TitianGerm


    3raser10 wrote: »
    Thank you so much! :D

    No problem. Any other questions just post here and I'll do my best to help :)


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    #12
    teach432
    Closed Accounts Posts: 46 ✭teach432


    Unless you're ready for everything that can be thrown at you in Q6 and Q7, all students should at least be able for Q5, even as a last resort.

    Are you ready if there is a Published Account or a Tabular Statement with a few new adjustments or if 100mk Farm Accounts finally comes up?


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    #13
    3raser10
    Registered Users Posts: 59 ✭✭3raser10


    I know how to do published accounts (just need to learn the notes thingy) thankfully & farm accounts as well. The max they can do is put a mixture of service, club and farm accounts workings in a 100m question right? & I get what we have done so far in tabular statement as well. Even if I mess up few new workings in tubular or suspense I think I'll be able to still get 70 to 75 marks in the question which apparently is the average marks you can get in Q5 so there is no point in trying to master this question at this stage but having said that, I think I will cover this question AFTER I have done revision for everything else including theory! :)


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    #14
    3raser10
    Registered Users Posts: 59 ✭✭3raser10


    & since Q5 is a guaranteed question, are there not higher chances of making this question harder each year than other questions? :/


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    #15
    Mr Pseudonym
    Closed Accounts Posts: 1,237 ✭✭✭Mr Pseudonym


    3raser10 wrote: »
    & since Q5 is a guaranteed question, are there not higher chances of making this question harder each year than other questions? :/

    Nope! Pretty much the same every year. Marking scheme clearly shows the level of detail required in the interpretation part, but it seems students pay no attention!


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    #16
    robman60
    Registered Users Posts: 2,222 ✭✭✭robman60


    Mr Pseudonym wrote: »
    Nope! Pretty much the same every year. Marking scheme clearly shows the level of detail required in the interpretation part, but it seems students pay no attention!

    But the marking scheme just shows for example 7 marks for gearing. It doesn't tell you exactly what each mark is going for. I've seen an exact marking scheme and each mark is going for a specified point that they decide is worthy of a mark. Nothing else will suffice which isn't exactly fair.


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    #17
    raz789
    Registered Users Posts: 30 ✭raz789


    robman60 wrote: »
    But the marking scheme just shows for example 7 marks for gearing. It doesn't tell you exactly what each mark is going for. I've seen an exact marking scheme and each mark is going for a specified point that they decide is worthy of a mark. Nothing else will suffice which isn't exactly fair.

    It's 5 different points per topic I believe, and you need to include appropriate ratios. That's usually how it's corrected.


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    #18
    Mr Pseudonym
    Closed Accounts Posts: 1,237 ✭✭✭Mr Pseudonym


    robman60 wrote: »
    But the marking scheme just shows for example 7 marks for gearing. It doesn't tell you exactly what each mark is going for. I've seen an exact marking scheme and each mark is going for a specified point that they decide is worthy of a mark. Nothing else will suffice which isn't exactly fair.
    raz789 wrote: »
    It's 5 different points per topic I believe, and you need to include appropriate ratios. That's usually how it's corrected.

    I wasn't aware of the marking scheme robman60 mentions. My understanding was that, similar to what raz789 says, one need give five sentences - with particular ones being essential, e.g relevant ratio under gearing heading. However, even if that's not the case, as there is only minimal change in questions from year to year it should be pretty easy to gauge what are the required points under each heading.


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    #19
    robman60
    Registered Users Posts: 2,222 ✭✭✭robman60


    @Mr Pseudonym: I'll type the example I have where each point is given a mark. It's done the same way for all other topics but I'll just give it for gearing. I agree with you that it should become predictable but it's rumoured that they alter the marking scheme here annually to reduce the number of A1s in an attempt to fit the bell curve. I have no evidence of that, other than anecdotally.

    Here is gearing and I've thrown in sector as well because I think it's quite bizarre that you can't suggest valid alternatives for the future of a particular sector.

    Gearing:
    -Last year gearing was 49% (1)
    -this year it is 43% (1) which is better (1)
    -company is lowly geared (1)
    -it is now less dependant on debt capital (1)
    interest cover has improved from 3 times to 5 times (1)
    -it is now easier to make interest payments (1)


    Sector
    long term prospects in the dairy industry (1) are not encouraging (1)
    the economic recession (1) is having a negative effect on the industry (1)
    The industry is at risk from over production and low cost competition (1)

    This may be from a mock paper, I can't recall exactly but this appears to be why most teachers advise students to avoid it. I'd still very much consider doing it as I'm confident I'd get 85/100 but I'm aiming for an A1 so I'm slightly wary of it.


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    #20
    Mr Pseudonym
    Closed Accounts Posts: 1,237 ✭✭✭Mr Pseudonym


    robman60 wrote: »
    @Mr Pseudonym: I'll type the example I have where each point is given a mark. It's done the same way for all other topics but I'll just give it for gearing. I agree with you that it should become predictable but it's rumoured that they alter the marking scheme here annually to reduce the number of A1s in an attempt to fit the bell curve. I have no evidence of that, other than anecdotally.

    Here is gearing and I've thrown in sector as well because I think it's quite bizarre that you can't suggest valid alternatives for the future of a particular sector.

    Gearing:
    -Last year gearing was 49% (1)
    -this year it is 43% (1) which is better (1)
    -company is lowly geared (1)
    -it is now less dependant on debt capital (1)
    interest cover has improved from 3 times to 5 times (1)
    -it is now easier to make interest payments (1)


    Sector
    long term prospects in the dairy industry (1) are not encouraging (1)
    the economic recession (1) is having a negative effect on the industry (1)
    The industry is at risk from over production and low cost competition (1)

    This may be from a mock paper, I can't recall exactly but this appears to be why most teachers advise students to avoid it. I'd still very much consider doing it as I'm confident I'd get 85/100 but I'm aiming for an A1 so I'm slightly wary of it.

    Thanks, man. I'd say that took a while to type! Are you sure that each of those is a required answer as opposed to just being a guideline (often there'll be a footnote saying to accept other appropriate answers)?

    What you said about adjusting the marking schemes does happen, but not to the extent that is often suggested. I imagine they just re-mark papers that are on the grade boundaries. They're probably likely to try to steal marks from theory questions and Q5, though.

    I did my LC a few years ago, and I was very confident that I could get an A1 in Q5, but it was always my aim to avoid it if possible (and I did!).

    Good luck!


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    #21
    raz789
    Registered Users Posts: 30 ✭raz789


    Marking Schemes are not exhaustive. It's clearly stated on them. If there's a valid point that's no on the marking scheme you should be given the mark. Also Mock's don't go through the same method as the real exam goes through. The Examiner will correct and if they're not sure if they should give the marks they'll hand it to their Advising Examiner.

    From the correction of my Mock, under each title I was given 1 mark for every relevant ratio and 1 mark for every point explaining each ratio.
    Some ratios have 2-3 points. The corrector clearly stated that I needed 5 points and the ratios.

    I definitely agree that it's possibly easily a subjective question. I will probably skip it too if the right questions come up.


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    #22
    TitianGerm
    Registered Users Posts: 27,843 ✭✭✭✭TitianGerm


    robman60 wrote: »
    @Mr Pseudonym: I'll type the example I have where each point is given a mark. It's done the same way for all other topics but I'll just give it for gearing. I agree with you that it should become predictable but it's rumoured that they alter the marking scheme here annually to reduce the number of A1s in an attempt to fit the bell curve. I have no evidence of that, other than anecdotally.

    Here is gearing and I've thrown in sector as well because I think it's quite bizarre that you can't suggest valid alternatives for the future of a particular sector.

    Gearing:
    -Last year gearing was 49% (1)
    -this year it is 43% (1) which is better (1)
    -company is lowly geared (1)
    -it is now less dependant on debt capital (1)
    interest cover has improved from 3 times to 5 times (1)
    -it is now easier to make interest payments (1)


    Sector
    long term prospects in the dairy industry (1) are not encouraging (1)
    the economic recession (1) is having a negative effect on the industry (1)
    The industry is at risk from over production and low cost competition (1)

    This may be from a mock paper, I can't recall exactly but this appears to be why most teachers advise students to avoid it. I'd still very much consider doing it as I'm confident I'd get 85/100 but I'm aiming for an A1 so I'm slightly wary of it.

    You might also want to mention that although the company has a low gearing that it would be advisable to compare to other similar companies in the same sector to compare gearing of those companies.
    I would also mention that the banks are reluctant to loan funds at this time due to the economic circumstances.


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